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Daily Links: trade trouble naked shorts deficit hysteria Plutocracy

Daily Links: Euro shift could start trade wars; Germany may be erratic but it's also right; the West's Plutocrats prevent the very reform needed to save the system and their own privileges.

Trade Implications of Euro Crisis Michael Pettis discusses the implications for current account adjustments and how they may lead to significant trade tensions between (and within Europe), the US and China (Asia).

Don't Sell Germany Short Stephanie Flanders at BBC from Germany makes a couple key points about Germany's move to a limited ban on naked shorting, that those who are hyperventilating about the ban ought check their tin ears and recognize political realities in Germany and that while the announcement of the ban was mishandled outsiders should make no mistake that Germany is serious about implementing some serious regulatory reform to drive home the point that governments not bankers are in charge (here's a link to a StickyFeet post discussing the issue previously: Germans Ban Naked Short Selling: More Reaction and also Sticky Feet at Daily Kos Crazy Germans! Wall Street Has Spasm....the German's do not have it all wrong...they are not bonkers, contrary to discredited conventional banker opinion; stay tuned as German is getting into the game in a big way).

Managed Democracy and the Specter of Inverted Totalitarianism Sheldon Wolin, a StickyFeet book recommendation (I do not get an affiliate fee).  A good analysis of present political of those books that is prescient in hindsight. Best I like this because it justifies calling our "democracy" a Plutocracy

Theory of the Leisure Class Thorstein Veblen. Hat tip to Dbug at Daily Kos "

Quoting Dbug:  "The productive class grows the wheat and bakes the bread. They spin the wool and sew the clothes. They lay the bricks and nail the wood to create buildings.

The predatory class owns the land, owns the factories, runs the military, preaches the sermons, and thinks they’re somehow superior to the people who do the real (productive) work."

If you're not up to date on your Veblen, now is the time to go back and catch up on his classical work.  If we cannot see Plutocracy present today it is because we have lost all historical perspective, minds numbed by 30 years of neo-liberal Corporatist dogma.  If things continue on the present track, reform will be insufficient and wrongheaded, and the Plutocrats will be setting the system up for another, potentially greater, collapse.   See Krugman today: Lost Decade Looming at NY Times (ok...he talks about stagnation, but then he hasn't yet become a full out Peak Oilist, but you have in Krugman one of the lone liberal voices with a mainstream megaphone that is shouting as loud as possible to tell us that the deficit hawk policy path we're taking, which is "conventional wisdom", is exactly the wrong advice for present circumstances).

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